Case law update: Are “sleep-in” shift workers entitled to the National Minimum Wage for time spent asleep?

The issue of how National Minimum Wage (NMW) is calculated for workers who work “sleep-in” shifts (i.e. where it is expected that they will sleep for part of their shifts), has been the subject of a significant body of case law.

Background

Until the recent Court of Appeal decision in Royal Mencap Society v Tomlinson-Blake and Shannon v Rampersad, the approach the courts tended to take was that time spent asleep for sleep-in workers could amount to working time for the purposes of the NMW Regulations. So, therefore, workers who were permitted or expected to sleep during parts of their shift were entitled to be paid NMW for the whole of their shift.

In response to this body of case law the Government issued guidance in 2015 stating that businesses and organisations should pay its sleep-in workers the NMW for the whole of their shift (typically, around £60 for an 8 hour shift) rather than just a flat rate “on call allowance” of £25-35 which had been the previous advice.

Court of Appeal decision

“Sleep-in” shifts are particularly common in the care industry and the approach of the courts referred to above meant that organisations in the care sector faced having to pay millions of pounds in back wages to its care workers who had previously been paid a flat rate. As a result, Mencap brought a legal challenge on behalf of the social sector.

In considering the issue again, the Court of Appeal has now, seemingly, reversed the position as it decided that sleep-in care workers were only entitled to NMW when they were “actually working” and not simply “available for work” (i.e. asleep during the shift). As a result, NMW is not necessarily payable in respect of the whole of the sleep-in shift.

What does this mean for businesses?

Although this will be a welcome decision for employers (and particularly those organisations in the care industry who faced a huge bill in potential back pay of wages), there may still be many cases where the line between “actual work” (which attracts NMW) and “available for work” (which does not) is not clear cut. For instance, there may be circumstances where workers are permitted to sleep but are also expected to wake at various points in order to carry out certain tasks.

It also remains to be seen whether this decision will be the subject of an appeal to the Supreme Court so it may not be the end of the story……

If you have any concerns in relation to how your workers who are permitted to sleep during shifts are paid, or what the Mencap Judgment means for your business, please contact a member of our employment team.